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Colorado oil drilling boom intensifies as voter initiatives multiply

Workers replace dirt displaced by flooding near a well head in Erie last fall. A state House committee on Tuesday moved forward a bill authorizing the analysis of potential health impacts of Front Range oil and gas development. (Associated Press file photo)

Colorado Attorney General John Suthers was walking down Denver's 16th Street Mall recently when a Greenpeace activist asked if he'd like to ban fracking.

It reflected the intensifying battle over how to balance public demands for a pristine environment and health versus ramped-up production of fossil fuels.

Front Range residents have proposed 17 state ballot measures to bolster local control over drilling, short of a statewide ban, and are drawing support from at least one Internet-made multi-millionaire — U.S. Rep. Jared Polis. Coloradans for Local Control campaign adviser Rick Ridder said national groups also will join the fray, fighting the industry's Colorado Oil and Gas Association and Coloradans for Responsible Energy Development.

Suthers concluded that "we are, in fact, the ground zero" in the national debate. "There's going to be more and more discussion about the local government-state tension" in regulating industry expansion, he said.

And this week in Denver, Suthers is hosting a first summit of states' chief law enforcement officers to address challenges as the expansion outpaces existing rules.

Among experts called for the forum, Colorado School of Mines petroleum geologist Steve Sonnenberg said he'll describe the scope of the boom. An area northeast of Denver holds 3 billion to 5 billion barrels of untapped oil, Sonnenberg said. While natural gas production is slowing, oil production in Colorado has set records — 63 million barrels in 2013, up from 49 million in 2012. "Now we're transforming back to an oil state," Sonnenberg said.

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For Suthers, the key question is just how far cities and towns can go to shield residents under current law, which establishes an overriding state interest in developing oil and gas. A state lawsuit against Longmont's limits — let alone local bans — has not been decided.

"If the court says Longmont is free to ban fracking ... that is an earth-shattering reversal by the court," Suthers said in a recent interview with The Denver Post.

Yet, in practice, Colorado's boom is so intense, with about 52,000 active wells, that companies increasingly negotiate — beyond state permitters — with local officials to craft compromises such as piling hay around equipment to muffle drilling near homes.

The 17 proposed ballot measures fall into two groups: one that would amend the constitution to allow tighter local control over oil and gas operations, and another that would require buffer zones statewide up to five times bigger than the 500-foot limit set by the Colorado Oil and Gas Conservation Commission.

If any voter initiative passes and gives locals power to prohibit owners of oil and gas from extracting it, "a huge consideration will be whether this will amount to a 'taking' of that property by the government," Colorado Municipal League attorney Geoff Wilson said. "If that's the case, a proposal to ban drilling may amount to a proposal that local taxpayers purchase all the affected mineral rights. That could easily make this popular political and policy choice a very expensive one for local taxpayers."

COGA referred questions about industry funding of ballot initiatives to CRED, which said a new group — Protecting Colorado's Environment Economy and Energy Independence — has been formed with $2 million in industry funding to oppose any change in the state constitution on issues already addressed by existing state rules.

COGA policy director Doug Flanders said companies "are focused on building rapport and working toward solutions with our communities and stakeholders. We will continue to do that — whatever is on the ballot."

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